(The Australian dollar has become one of hedge funds' favorite currencies to short as growth in China slows, hitting Australian commodity exports to the Asian giant. It's up 2.1% against the U.S. dollar today alone.)

The chart below shows the sharp sell-off in the dollar index.

Thinkorswim

One big area of weakness for the dollar today is against the Japanese yen, another favorite trade among global investors in recent quarters. The dollar is down 1.3% against the yen as investors cover their short-yen positions.

Buying Japanese stocks and selling the yen against the dollar has become one of the most consensus trades in the world, but in the past two weeks or so, it's run into some serious trouble.

The dollar has fallen from a high of ¥103.72 against the yen to current levels around ¥99.17 today.

The release caused bond yields to fall as investors rotated back into U.S. Treasuries in a safe-haven bid. That triggered a plunge in the dollar index and a big upward move in the yen, illustrating how the U.S. economic comeback story is still the biggest theme driving global markets right now.